"I suspect we'll be in government with the Tories by Monday morning." That's the verdict of one senior Lib Dem source I spoke to this weekend.

The prospect of a Cameron-Clegg coalition should send a shiver down the spine of progressives across the land. Could it happen? The pro-establishment, pro-first-past-the-post, anti-European Conservatives in bed with the anti-establishment, pro-PR, pro-European Liberal Democrats?

If it does, I blame John Prescott. In an interview with the New Statesman last year, the former deputy prime minister proudly described how he had been the chief roadblock to a Lab-Lib pact, and a progressive realignment of British politics, in the early days of the New Labour administration. Prescott confessed that, on one occasion, Tony Blair had asked him whether Paddy Ashdown could join the government. "I said, 'If he walks in that door, I'm out that door. No discussion.'" Later, in a separate conversation with Ashdown himself, the ruthlessly tribal and typically foul-mouthed Prescott remarked: "You're a fucking Liberal. We've got a majority of 160 - what do we want you for?"

Perhaps, this weekend, Prescott should ask himself the same question again. Labour is on the verge of opposition, having lost a million votes and more than 90 seats. The Liberal Democrats are the only hope Labour has of stopping the removal vans from heading for Downing Street. Belatedly, the party's tribal tendency has had to recognize the "progressive dilemma", first identified by David Marquand, which concluded that Labour is a necessary, but not sufficient, obstacle to Conservative dominance.

So what now? Gordon Brown on Friday promised "immediate legislation" for a referendum on a "fairer voting system". Even Charlie Whelan is now on board the PR bandwagon.

But it might be too little, too late. The Lib Dem frontbencher I spoke to believes Cameron's Conservatives are desperate enough to offer a referendum on electoral reform – and Clegg, he says, will take it.

Personally, I have my doubts as to whether David Cameron, like Ted Heath before him, will agree to genuine electoral reform. So far he has suggested only a Sir Humphrey Appleby-style "all-party committee of enquiry".

My Lib Dem source, however, is convinced that a deal with the Tories is doable. And if Cameron does end up offering a referendum on PR, he will have succeeded – accidentally – where Tony Blair, Gordon Brown and New Labour so miserably failed. To be honest, I never, in my wildest dreams, imagined that much-needed electoral reform might have to come at this price. Labour tribalists should hang their heads in shame.